A Reexamination of Tunneling and Business Groups: New Data and New Methods

One of the most rigorous methodologies in the corporate governance literature uses firms\u27 reactions to industry shocks to characterize the quality of governance. This methodology can produce the wrong answer unless one considers the ways firms compete. Because macro-level shocks reverberate differently at the firm level depending on whether a firm has a cost structure that requires significant adjustment, the quality of governance can only be elucidated accurately analyzing a firm\u27s business strategy and their corporate governance. These differences can help one determine whether the fruits of a positive macro-level shock have been expropriated by insiders. Using the example of Indian firms, we show that an influential finding is reversed when these differences are considered. We further argue that the conventional wisdom about tunneling and business groups will need to be reformulated in light of the data, methodology, and findings presented here

Innovation Outcomes in a Distributed Organization: Intra-Firm Mobility and Access to Resources

Prior research has established a relation between intra-firm mobility and innovation outcomes at distributed organizations. The literature has also uniformly agreed on the mechanism underlying this relationship: the sharing of tacit knowledge and recombination of ideas that occurs because of intra-firm mobility. But a second mechanism may also be at work: intra-firm mobility might help distant employees secure access to resources for their innovative projects. Using unique data on travel, employment, and patenting for 1,315 inventors at the Indian R&D center of a Fortune 50 multinational, I find that intra-firm mobility in the form of short-duration business trips from a distant R&D location to headquarters is positively related to higher subsequent patenting at the individual level. I also find mobility immediately prior to meetings at which R&D funds are most likely to be disbursed to be related to higher subsequent patenting. This study sheds new light on how intra-firm mobility and possible face-to-face interactions with those who allocate resources might affect innovation outcomes and the matching of resources to individuals within a distributed organization

Charting Dynamic Trajectories: Multinational Firms in India

In this article, we provide a synthesizing framework that we call the "dynamic trajectories" framework to study the evolution of multinational enterprises (MNEs) in host countries over time. We argue that a change in the policy environment in a host country presents an MNE with two sets of interrelated decisions. First, the MNE has to decide whether to enter, exit, or stay in the host country at the onset of each policy epoch; second, conditional on the first choice, it has to decide on its local responsiveness strategy at the onset of each policy epoch. India, which experienced two policy shocks—shutting down to MNEs in 1970 and then opening up again in 1991—offers an interesting laboratory to explore the "dynamic trajectories" perspective. We collect and analyze a unique dataset of all entry and exit events for Fortune 50 and FTSE 50 firms (as of 1991) in India in the period from 1858 to 2013 and, additionally, we document detailed case studies of four MNEs (that arguably represent outliers in our sample)

Sink or Swim: The Role of Workplace Context in Shaping Career Advancement and Human-Capital Development

We develop and test predictions on how early-career challenges arising from the workplace context affect short- and long-term career advancement of individuals. Typically an organization’s decision to deploy a manager to one of several possible contexts is endogenous to unobservable factors, and selection makes it challenging to disentangle the effect of workplace context on individual career advancement. We work around this problem by studying an organization, the Indian Administrative Services, which deploys entry-level managers quasi-randomly across India. We find that managers deployed to more challenging contexts early in their careers experience faster career advancement in the short term. We present suggestive evidence that this is because challenging contexts provide managers more opportunities to develop skills (“crucible experiences”) and a greater motivation to relocate out of the challenging context. We also find that managers deployed to a challenging context early in their careers continue to experience faster advancement in the long term, suggesting that initial deployment to a challenging context is associated with human capital development. Managers initially deployed to more challenging contexts were not, however, more likely to break into the upper echelons of the organization

GitLab: work where you want, when you want

GitLab is a software company that works “all remote” at the scale of more than 1000 employees located in more than 60 countries. GitLab has no physical office and its employees can work from anywhere they choose. Any step of the organizational life of a GitLab employee (e.g., hiring, onboarding and firing) is performed remotely, except for a yearly companywide gathering. GitLab strongly relies on asynchronous coordination, allowing employees to work anytime they want. After highlighting some of the main practices implemented by GitLab to effectively work all remotely and asynchronously, I asked renowned organizational scientists their thoughts on this interesting case and to question the generalizability of the all remote asynchronous model. Understanding whether and under what conditions this model can succeed can be of guidance for organizational designers that are now considering different remote models in response of the COVID-19 shock and its aftermath

Return Migration and Geography of Innovation in MNEs: A Natural Experiment of On-the-job Learning of Knowledge Production by Local Workers Reporting to Return Migrants

I study whether return migrants facilitate knowledge production by local employees working for them at geographically distant R&D locations. Using unique personnel and patenting data for 1,315 employees at the Indian R&D center of a Fortune 500 technology firm, I exploit a natural experiment where the assignment of managers for newly hired college graduates is mandated by rigid HR rules and is uncorrelated to observable characteristics of the graduates. Given this assignment protocol, I find that local employees with returnee managers file disproportionately more US patents. I also find some evidence that return migrants act as a 'bridge' to transfer knowledge from the MNE headquarters to the local employees working for them